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Are you Ready to Start a Company?

I had the good fortune of attending a dinner with John Chambers, CEO of Cisco. When he was asked why he takes the time to speak to small groups of startup CEOs and entrepreneurs, he recounted a story of having been mentored by the CEO of Hewlett Packard in his early days in the valley. And when he asked the HP exec how he could repay the favor, the HP CEO simply said that he should take the time to mentor the next generation so that the unique assets of the valley transcend generations. Few entrepreneurs have access to regular mentoring from leaders of multi-billion dollar companies. Fortunately, you do not need that mentoring to start a company. What you do need though, is virtual leadership experience. Virtual leadership experience is what MBA programs aim to leverage. They take individuals through a large number of case studies with the goal of building muscle memory to help those individuals confront future situations. The good news is, you don’t need a MBA program to build entrepreneurial muscle memory either.

Let’s step back. Wanting to start a company and being ready to start a company are two independent things. Of course, there are plenty of stories of successful entrepreneurs without work experience – Bill Gates and Mark Zuckerberg among them. But the overwhelming majority of successful founders have been ready to lead. Indeed, the most important experience you can have prior to starting a company is to work at a start-up. Why is that? Because larger companies don’t expose you to enough situations, frequently enough, that would parallel the type of situations that you would need to confront if you were to start your own company. But just because you have worked at a startup, doesn’t mean you are ready to start a company. Once you’ve checked the box on desire, commitment, passion, risk tolerance, family situation and all of the other “must-haves,” you can now ask yourself the key question – are you ready?

This is where virtual leadership experience comes in. Throughout your time at an early-stage or growth-stage company, you will see a lot of situations that go well beyond your job, regardless of whether you are an engineer, product manager, finance person or salesperson. You will see product decisions being made around you. You will see the way decision-making takes place. You will understand your company’s interview process. You will understand the way leaders communicate in the face of adversity. You will watch politics develop – and see whether it gets squashed or cultivated. You will see competitors emerge, and watch how your company responds. You will see financial pressures, and watch how your company handles it. You will see good quarters – and see whether your company gets ahead of itself. You will see bad quarters – and see whether your company gets down on itself. You will see good hires and bad fires. In a relatively short period of time, you will encounter a richer curriculum than your average MBA program offers. You can choose to ignore the things going on around you or you can treat every single thing going on around you as a course in virtual leadership. Let me be specific: If you want to test whether you are ready for a start-up, put yourself in the shoes of the leaders of your company and every time your company is confronted with a situation, ask yourself – what would I do in this situation if I were leading my company? You are living through a true experiment. When a product decision is being made, seek out the information relevant to the decision and force yourself to make a call on the decision (ideally share that thinking with product leaders). Then watch how that decision plays out and look back on your instincts to figure out whether they were wise or unwise. If a personnel decision is being made, think about how you might handle the situation. Then watch how things play out and grade yourself. Think about how your leaders prioritize and communicate and evaluate how you might have approached those tasks. You can take this approach to almost everything going on around you.

One of the benefits to putting yourself through virtual leadership training is that you will learn a very broad set of things about startup decision-making across a range of functions. That will serve you well downstream when you need to weigh in on decisions you don’t have much experience in. More importantly, it will hone your instincts. The difference between being responsible for some decisions and being responsible (ultimately) for all decisions is a very big one and it is the fundamental difference between working at a startup and leading one. Very often, early on in your mental training session (and if you work for a good company), you will find that your instincts aren’t actually all that good. You’ll find that you may not have come to the same conclusions as your leaders, and that very often your thought process was not sound. You’ll also feel pretty uncomfortable – fundamentally lacking in clarity around what the right answer is. But over time, like any muscle, you’ll hone those instincts. You’ll start to agree with your leaders on some things and differ on others. You’ll develop greater and greater confidence in your decision-making and approach to situations. Once you’ve navigated two years or so of virtual leadership training, and graded yourself an A consistently across a range of multi-functional situations – you’re ready to join the thousands who are feverishly building their own dreams.